SCHJ vs VCSH

SCHJASchwab 1-5 Year Corporate Bond ETF

VCSHAVanguard Short-Term Corporate Bond ETF

In short

SCHJ Short-dated corporate credit at index-fund pricing. SCHJ tracks the Bloomberg US 1-5 Year Corporate Bond Index for 0.03% a year, sits at the bottom of its category's fee table, and pays monthly.

VCSH Corporate credit, kept short. VCSH tracks an index of investment-grade company bonds maturing in one to five years, at three basis points: you take company credit risk instead of government risk, with muted sensitivity to rate moves.

Stated mandate

SCHJ The fund seeks to track, before fees and expenses, the total return of an index measuring the short-term U.S. corporate bond market.

VCSH The fund seeks to follow a market-weighted corporate bond index with a short-term dollar-weighted average maturity, using index sampling and investing at least 80% of assets in index bonds.

Why people hold it

• SCHJ 0.03% a year, against a 0.19% median for investment-grade corporate ETFs. No peer in the cohort charges less.
• Thousands of individual bonds in the basket, so no single issuer's trouble moves the fund much.
• The 1-5 year maturity ceiling means less price swing per move in rates than intermediate corporate funds like VCIT or IGIB, which sit further out the curve.
• Interest is passed through monthly rather than quarterly, and the fund ranks in the top quartile of its investment-grade corporate peer group overall.

• VCSH A 0.03% expense ratio, versus a 0.12% median across its peer group. That is Treasury-index pricing for a fund doing corporate credit work.
• Running since 2009 and now a multi-billion-dollar fund that trades actively, which is one of the easier profiles to get in and out of in its category.
• Samples the Bloomberg U.S. 1-5 Year Corporate Bond Index with at least 80% of assets in index bonds, and its book lines up closely with that benchmark.vanguard.com
• Distributions land monthly, not quarterly, and it sits among the strongest implementations in its cost-and-tracking peer group.

Worth knowing

• SCHJ This is company debt, not Treasuries. Downgrades and defaults are part of the deal, and short maturities shrink that risk without erasing it.
• A mid-size fund with moderate trading volume, so spreads can run wider than at the category's giants. Limit orders matter more here.
• Launched in 2019, so its record is shorter than rivals that traded through earlier credit cycles.

• VCSH These are company bonds, not government paper. Investment grade, but credit spreads can widen when markets get nervous, and Treasuries do not carry that risk.vanguard.com
• The one-to-five-year maturity band cuts both ways: smaller price swings when rates jump, and less duration to work with when rates fall.vanguard.com
• Index sampling means it holds a representative slice of the benchmark rather than every bond in it, so small differences from the index are normal.vanguard.com

Full SCHJ profile⁠

Full VCSH profile⁠